Cash Free On-Board - Open Discussion

[tricia]

And, for the time being at least, not enough people use Bitcoin for it to be worth it for most merchants to set up a way to accept Bitcoin payments.

 

[jis]

It may be more worthwhile playing the market using the recently introduced Bitcoin ETF, than to use the Bitcoin for actual transactions given the wild fluctuations in its value from day to day.

 

[chrsjrcj]

Bitcoin fees are much higher now than what Visa/Mastercard merchants charge. There are much better alternatives, although this is not the site for that.

As far as being scammed, there are a number of reputable Bitcoin merchants. Microsoft was one, until the aforementioned transaction fee rose to obscene levels.

 

[Devil's Advocate]

(1) I admit bias on this subject; to me, cash is sinister. I simply wanted a forum topic where both sides of what almost is a social issue can be discussed. (2) Paper money fuels corruption, terrorism, tax evasion and illegal immigrationso the U.S. should get rid of the $100 bill and other large notes. (3) Cash is also deeply implicated in tax evasion, which costs the federal government some $500 billion a year in revenue.

(1) You didn't admit anything until someone recognized you were being deceptive and called you out on it first. Keeping your motives secret in order to instigate a debate in bad faith doesn't sit well with me.

(2) Consider the following. I take my "sinister" cash as you call it and buy an OTC debit card with this cash. By your low effort reasoning I've now turned something evil into something wholesome even though I've presented zero identification or other evidence of where this cash came from. Doing away with currency acceptance doesn't stop corruption, terrorism, or tax evasion, but it does hurt smaller businesses and poorer customers with burdensome middleman fees and punitive penalties. If you really want the world to run on plastic payment then you first need make plastic money work the same or better than paper money did before it. Not just for large businesses and wealthy people, but for smaller businesses and poorer people just scraping by as well.

(3) The current tax system is embarrassingly friendly to large businesses, capital gains recipients, and offshore tax havens while simultaneously being obnoxiously punitive toward conventional wage earners, so you can take your bizarrely narrow concern over who pays what and shove it where the currency don't shine.

So you think continuously doing the same broken thing is the solution? I'd like to hear YOUR solution to the bad employees which Amtrak can't seem to get rid of.

What are you even talking about? I never claimed I had a solution to Amtrak's rape or theft problems. That's your bailiwick, not mine. I said that banning currency for the purpose of preventing theft or rape didn't make any sense to me. Does a thief stop stealing simply because there's no company cash around or do they look for another target that can be stolen now and converted into something negotiable later? If employed thievery is a major problem then perhaps Amtrak should mount some cameras in the diner/cafe or install a bill reading machine that converts cash into vouchers or offer to give passengers a free meal anytime the LSA doesn't provide an accurate itemized receipt.

Bitcoin - the legal tender of the Internet and the New Age. Free from political influence, free from national boundaries, free from illegitimate government seizure (which happens on Amtrak all the time).

That is simply not true. No matter where you live or where you were born your finances will be under the jurisdiction of one or more governments. Changing currencies or instruments does not dissolve current laws or change jurisdiction.

 

[Anderson]

How are café prices listed between Seattle and Vancouver? Are they in US$, CN$ or both?

All cafe items are priced in USD. Canadian bills are accepted at some rate of exchange, and change is given in USD. Canadian coins are not accepted. Remember Canada has no bills under $5, $1 (loonie), and $2 (twoonie) are coins.

When I traveled on it in late September 2017, Canadian bills were accepted at parity to the USD (there was no exchange rate conversion done, and change was given in USD.) It was a good way to clear out a bit of leftover Canadian currency from the trip.

There most certainly is an exchange rate, which is calculated by the POS. If the LSA offered you dollar for dollar, then they had the pay the difference between what they took from you and what Amtrak valued that currency as.

I seem to recall that on occasion a rate was posted. Also, I recall that the rate was significantly unfavorable vis-a-vis the spot rate (it was roughly on par with your hotel front desk rates IIRC).

 

[IndyLions]

Boy - this topic brought out the “freak show” element from both sides of the argument

Yeesh !

 

[Devil's Advocate]

Boy - this topic brought out the “freak show” element from both sides of the argument Yeesh !

 

[neroden]

Look at every mass transit system in the country. Philadelphia and Chicago recently implemented the latest technology systems that support contact-less communication like Apple Pay and embedded chips. You can swipe your credit card straight at the turnstile and hop on the subway.

They also splurged for machines that will convert cold hard cash into a fancy contactless ticket.

Why? Because they would have lost a lawsuit had they otherwise not offered this option.

I highly doubt that the primary reason those ticket machines exist (and especially the reason that the contactless tickets/cards issued by the fare agency exists) is simply because it avoids a potential Title VI lawsuit.

Contactless cards/tickets issued by the fare agency exist because most people don't carry contactless credit/debit cards in their wallet or use Apple Pay/Android Pay/Samsung Pay on a regular basis. I finally have a contactless credit card as of a month ago, and I've had credit cards for a number of years. Contactless just isn't prevalent in most cards issued in the US, and so there needs to be some way for people to convert their non-contactless payment into a contactless form. The easiest (and probably cheapest) way of doing that is to have people purchase contactless cards from the agency and refill them; the agency can process the actual credit card payment less often and at times where transaction time isn't of the essence (thus saving fees and boarding wait time.) It's also easier to have a physical machine to refill the card as not everyone with a card can easily log into a web browser to refill their card right when they need to. Some agencies even go so far as to not need the card to physically talk to the central server, thus not even requiring constant connection to the central office (which would absolutely be required to process payments on board.) Metro Transit in Minneapolis/St. Paul still has their system like this; transactions are processed on the card itself and uploaded to the server when the bus goes into the garage at night. This is despite the fact that most buses have a connection for the real-time tracking system and free customer wi-fi on board.

Once you've made the investment in machines and the backend to issue agency-specific cards (which is required if you want relevancy for most people) it's comparatively trivial to integrate cash refills into that system.

Contactless is, FWIW, *wildly* insecure -- it's prone to drive-by data copying -- so nobody will EVER have contactless cards as their primary form of large-value payment. For a subway card which maybe has $10 or $20 on it at a time sure; for big money, nobody sane does it.

In the US, the lax laws on debit cards mean that nobody should ever use them either, though many ignorant people do. (They're safe enough in Europe, where the laws mean that if your card is stolen or copied, the bank is required to immediately return all the money while the investigation is happening; but in the corrupt US, the bank doesn't have to do so, and doesn't do so, so a debit card is just a large hole where you can lose all your money for years on end.) Credit cards are OK because the *bank* takes the risk.

However, this leads us back to the fundamental problem with credit cards and debit cards: sometimes they're denied or not approved, for crazy/stupid reasons. I've had my credit card incorrectly stop working too many times, due to the credit card company deciding that my normal transaction pattern was "fraud". Since that point, I always carry enough cash to pay for everything. I would carry checks, but most businesses are being stupid and not accepting out-of-state checks any more.

Cash is king, particularly in the travel business, because cash is *reliable*. You know it will work for payment. Nothing else is actually reliable.

 

[neroden]

tricia, I completely agree with you. Personally, I am all for more choices rather than less. But if a business can pull it off with cards only without losing too much business, they tend to do so these days, since apparently the overall cost of handling card transactions tends to be less than the overall cost of handling cash - again, I say apparently, because if that were not so, so many businesses would not tend to move in that direction.

I know for a fact that the overall cost of handling cash is less than the overall cost of handling card transactions for small businesses. Personal communication with dozens of small business owners. Many will actually give discounts for cash payments. ALL prefer it.

Maybe it's different for multinational corporations, but the situation for small businesses is crystal clear: cards have a high fee cost to them, cash has no costs at all.

 

[Manny T]

The cost to Amtrak from theft of cash by employees (and other types of theft and abuse) was estimated by the IG (in 2011) to be between $4-7 mil a year.

So Amtrak is not like a "small business." Small business owners probably don't steal from themselves.

 

[cpotisch]

Bitcoin - the legal tender of the Internet and the New Age. Free from political influence, free from national boundaries, free from illegitimate government seizure (which happens on Amtrak all the time).

That is simply not true. No matter where you live or where you were born your finances will be under the jurisdiction of one or more governments. Changing currencies or instruments does not dissolve current laws or change jurisdiction.

I agree with everything you said except for that. It is pretty much impossible (literally) to seize bitcoins without consent from the owner. They could always prosecute or arrest you, of course, but if you just flat out refuse to give access, there's really nothing they can do about it. Sorry if I misunderstood your point, but I just figured I'd mention it.

 

[jis]

I suspect they can do plenty if you happen to get within 100 miles of the US border or coast.

Even otherwise, if you live in a taxing jurisdiction you are screwed. Never be too sanguine about believing that the government cannot make you disappear from reality if it so chooses.

 

[Devil's Advocate]

Bitcoin - the legal tender of the Internet and the New Age. Free from political influence, free from national boundaries, free from illegitimate government seizure (which happens on Amtrak all the time).

That is simply not true. No matter where you live or where you were born your finances will be under the jurisdiction of one or more governments. Changing currencies or instruments does not dissolve current laws or change jurisdiction.

I agree with everything you said except for that. It is pretty much impossible (literally) to seize bitcoins without consent from the owner. They could always prosecute or arrest you, of course, but if you just flat out refuse to give access, there's really nothing they can do about it. Sorry if I misunderstood your point, but I just figured I'd mention it.

In a theoretical sense Bitcoin is a mostly anonymous nearly untouchable currency, and for some highly organized and well connected subversive and/or criminal elements it can come pretty close to achieving that goal, but for average everyday wage earners such a claim is hopelessly impractical. The practice of converting conventional wealth into and out of BTC still creates a paper trail and the BTC itself still has to be located on a server or in a digital wallet somewhere that can be seized or destroyed. There are modes and methods for working around these limitations but they generally require a level of skill and dedication that is not possessed by average everyday consumers.

 

[chrsjrcj]

Because cash can never be seized by the government.

 

[cpotisch]

Because cash can never be seized by the government.

Dear god. I'm just imagining going through that. For anyone who wants to learn more about the ridiculous system that is civil forfeiture...

 

[jebr]

Maybe it's different for multinational corporations, but the situation for small businesses is crystal clear: cards have a high fee cost to them, cash has no costs at all.

Except cash does have some costs, even to small businesses. It's just that those costs are typically in time and increased risk rather than in specific transaction costs. Cash still needs to be brought to the bank, change needs to be brought back from the bank, and there's always the chance of theft with cash (someone raiding the register drawer, stealing a deposit envelope/pouch filled with cash, etc.) Going to and from the bank takes time, and theft risk is real. The difference is that for most small businesses, the owner goes to the bank anyways (they may not have a setup to process checks electronically, and they still need/want to accept checks.) Theft risk isn't mitigated, but it's reduced as the deposit is typically done by the owner (so there's less risk of internal theft) and it happens rarely enough that it's not seen as a transactional cost of taking cash. Credit cards have fees on every transaction, and it's easy to see the cost, where the cost of cash transactions is almost a sunk cost and relatively static (and seen as low, as it affects time to some extent but not the amount of cash they have.)

Once a business gets beyond a certain size, especially once there's a number of physical locations, that calculus changes. Internal theft becomes more likely, armored car services may need to take the place of simple transactions at the bank itself, etc. That all costs money, and at that point the cost of a credit card transaction is seen as pretty comparable to the cost of dealing with the cash.

 

[jis]

I spent 5 years being VP of Finance of a 501(c )3 (that is I got to sign the 990 under the strictures of Sarbanes-Oxley) with an annual budget of a couple of million dollars, and in that role I happened to come in touch with several people holding similar posts in much larger outfits. The general opinion among them was that they prefer to not handle cash if they can help it. I don't claim any personal knowledge beyond that on this matter. In the 501©3 we did not handle any cash at all. It was all bank transactions whether it be checks or Credit/Debit card transactions or EFT of other sorts. We simply did not have the infrastructure or budget to handle cash effectively, and that was a conscious decision made by the Board before I came on board.

 

[seat38a]

Maybe it's different for multinational corporations, but the situation for small businesses is crystal clear: cards have a high fee cost to them, cash has no costs at all.

Except cash does have some costs, even to small businesses. It's just that those costs are typically in time and increased risk rather than in specific transaction costs. Cash still needs to be brought to the bank, change needs to be brought back from the bank, and there's always the chance of theft with cash (someone raiding the register drawer, stealing a deposit envelope/pouch filled with cash, etc.) Going to and from the bank takes time, and theft risk is real. The difference is that for most small businesses, the owner goes to the bank anyways (they may not have a setup to process checks electronically, and they still need/want to accept checks.) Theft risk isn't mitigated, but it's reduced as the deposit is typically done by the owner (so there's less risk of internal theft) and it happens rarely enough that it's not seen as a transactional cost of taking cash. Credit cards have fees on every transaction, and it's easy to see the cost, where the cost of cash transactions is almost a sunk cost and relatively static (and seen as low, as it affects time to some extent but not the amount of cash they have.)

Once a business gets beyond a certain size, especially once there's a number of physical locations, that calculus changes. Internal theft becomes more likely, armored car services may need to take the place of simple transactions at the bank itself, etc. That all costs money, and at that point the cost of a credit card transaction is seen as pretty comparable to the cost of dealing with the cash.

Well I guess if they skim and hide actual sales from the government then it is cheaper for them. Not sure about the rest of the country but out here, when a business is cash only, you hear people snicker "oh they are probably hiding it from the government."

 

[me_little_me]

While it doesn't apply to Amtrak, credit/debit sales are somewhat of a hassle for small businesses even if one excludes the bank fees. As one who is a volunteer for a non-profit museum that has a gift shop and the one who does the computers for them, I told them "No way" when they thought of using the computer to process CC transactions when I read the bank security and responsibility (read blame) rules for doing so. There was no way they could sign the required forms and be safe from either attack or bank lawsuits. They decided to just continue using the bank's machine and entering the sale manually in their inventory/POS system.

The possibility of having a machine on board that would take cash and dispense a ticket for a specific amount of cash is a possibility although it comes with inconveniences both for customers and Amtrak.

 

[tricia]

Maybe it's different for multinational corporations, but the situation for small businesses is crystal clear: cards have a high fee cost to them, cash has no costs at all.

Except cash does have some costs, even to small businesses. It's just that those costs are typically in time and increased risk rather than in specific transaction costs. Cash still needs to be brought to the bank, change needs to be brought back from the bank, and there's always the chance of theft with cash (someone raiding the register drawer, stealing a deposit envelope/pouch filled with cash, etc.) Going to and from the bank takes time, and theft risk is real. The difference is that for most small businesses, the owner goes to the bank anyways (they may not have a setup to process checks electronically, and they still need/want to accept checks.) Theft risk isn't mitigated, but it's reduced as the deposit is typically done by the owner (so there's less risk of internal theft) and it happens rarely enough that it's not seen as a transactional cost of taking cash. Credit cards have fees on every transaction, and it's easy to see the cost, where the cost of cash transactions is almost a sunk cost and relatively static (and seen as low, as it affects time to some extent but not the amount of cash they have.)

Once a business gets beyond a certain size, especially once there's a number of physical locations, that calculus changes. Internal theft becomes more likely, armored car services may need to take the place of simple transactions at the bank itself, etc. That all costs money, and at that point the cost of a credit card transaction is seen as pretty comparable to the cost of dealing with the cash.

Well I guess if they skim and hide actual sales from the government then it is cheaper for them. Not sure about the rest of the country but out here, when a business is cash only, you hear people snicker "oh they are probably hiding it from the government."

Well, to counter your blanket insult to the honesty of merchants, I can offer one data point from North Carolina: My retail business is primarily cash, and I do report all of the cash I take in, both to the IRS and to the state sales-tax department.

 

[Lonestar648]

When people talk about handling cash, they forget about the annoyance of handling coins. More time was consumed tracking these 5 everyday pieces. Also, we had the security issues of locking up and depositing cash. People miscounted change, so shortages were a fact of life. Problems had to be dealt with like were any 20's counterfeit, Internal theft was always a concern. So in the end, we calculated the loss we took on accepting credit cards was better than accepting cash, unfortunately, we couldn't go cashless, but certainly wanted to go that direction.

 

[pennyk]

Moderator note: an inappropriate post was hidden by staff and all responses to that post were also hidden.

Please try to stay more or less on topic and remain civil. Thank you.

 

[neroden]

Maybe it's different for multinational corporations, but the situation for small businesses is crystal clear: cards have a high fee cost to them, cash has no costs at all.

Except cash does have some costs, even to small businesses. It's just that those costs are typically in time and increased risk rather than in specific transaction costs. Cash still needs to be brought to the bank, change needs to be brought back from the bank, and there's always the chance of theft with cash (someone raiding the register drawer, stealing a deposit envelope/pouch filled with cash, etc.) Going to and from the bank takes time, and theft risk is real. The difference is that for most small businesses, the owner goes to the bank anyways (they may not have a setup to process checks electronically, and they still need/want to accept checks.) Theft risk isn't mitigated, but it's reduced as the deposit is typically done by the owner (so there's less risk of internal theft) and it happens rarely enough that it's not seen as a transactional cost of taking cash. Credit cards have fees on every transaction, and it's easy to see the cost, where the cost of cash transactions is almost a sunk cost and relatively static (and seen as low, as it affects time to some extent but not the amount of cash they have.)

Once a business gets beyond a certain size, especially once there's a number of physical locations, that calculus changes. Internal theft becomes more likely, armored car services may need to take the place of simple transactions at the bank itself, etc. That all costs money, and at that point the cost of a credit card transaction is seen as pretty comparable to the cost of dealing with the cash.

And then at some point you get large enough to have mass-scale electronic attacks to relieve you of your electronically-recorded money, and those losses start being larger than cash losses.

There's always problems. I've found that cash is better if you need a guarantee that you can actually buy or sell something promptly, and credit cards are better if you don't really mind random failures and rejections requiring retrying the transaction a week later.